ICANN GNSO Council gTLDS committee - new gTLDs, conclusions v5

ICANN GNSO Council new gTLDs committee report - draft final report

Compromise text

Version 4 published 9 May 2003
Updated 13 May 2003: gTLD Registries Statement added
Version 5 published 21 May 2003

Report Contents: (3 pages)

Introduction

Objectives of expanding the name space

Objectives of expanding the name space relating to IDNs

Strategies to meet the objectives

To sponsor or not to sponsor?

Additional considerations

- Technical and financial qualification

- Registry /sponsor failure

Annexes: (16 pages)

Background on establishment of the committee.

Constituency positions.

Introduction

The GNSO council invoked a committee of the whole to address the
question asked of it by the ICANN Board (resolution 2.151 see annex 1):
"whether to structure the evolution of the generic top level namespace
and, if so, how to do so." The committee met monthly by telephone
conference between February and May 2003 and all constituencies
submitted written positions during this time. The committee included
representatives of the At-large Advisory Committee and the Government
Advisory Committee.

One fundamental question was the interpretation of the question asked.
Some participants related the question to the statement on "taxonomic
rationalization" made by the ICANN CEO in October 2002, and interpreted
"structured" as meaning to them a top-down taxonomy with a
pre-determined set of names chosen by ICANN. Others saw no conflict
between the concept of a taxonomy and a bottom-up, demand-driven system.
Many constituencies interpreted "structured" more widely meaning within
a framework of objectives.

Indeed all participants had in some measure or other a vision of how the
gTLD namespace should look. It was agreed that a future expansion should
take place in such a way that was demand-driven and bottom-up and in a
way that increased competition while avoiding net user confusion and
deception. Some participants also supported the ideas aired in the Lynn
paper[1] of value added and differentiation.

Conclusions

Expansion of the gTLD namespace should be a bottom-up approach with
names proposed by the interested parties to ICANN. Expansion should be
demand-driven. There is no support for a pre-determined list of new
names that putative registries would bid for.

This is not to say there is support for anarchy. In line with ideas
set-out in the Lynn paper March 2003[2] the committee endorsed the
concept of a set of objective criteria that should be met in any future
expansion. The development of this set of objective criteria should be
the subject of a new Policy Development Process (PDP). Possible criteria
for this PDP are listed below together with some strategies which point
to practical, non-burdensome ways in which they can be met.

Expanding the name space - possible objective criteria

There should be a consistent and common set of safeguards for consumers
and users in the introduction of new names.*

(*meaning in this paper, new generic Top-Level Domain Names gTLDs).

Future expansion should increase the level of competition.

Future expansion should avoid names that are confusingly similar so
as to avoid confusing net users.

An easily understood relationship must exist between a new gTLD and
its stated purpose.

Future names should be both for commercial and non-commercial
purposes.

Future names should add-value to the domain name system. The purpose
of introducing new names is to make the domain name system more useful
and more accessible to broader communities of interest and to more end
users (Lynn report 3-2003).

Objectives of expanding the name space relating to IDNs - the criteria

These recommendations will require integration with work elsewhere on
IDNs.

Future names could be in any language, subject to the technical
recommendations coming out of the existing work on internationalized
domain names (IDN). A significant limiting factor is the stability of
the namespace. In respect to IDN gTLDs (i.e. IDN.IDN) ICANN should
ensure that the LDH* translation or transliteration of any new IDN gTLD
should not be confusingly similar to an existing generic LDH gTLD or
vice-versa, so as to avoid confusing net users. (This was the majority
but not the universal view.)

New names that were IDN translations or transliterations of an
existing gTLD or vice-versa, should be obliged to follow the same
policies and practices of the original gTLD. In particular, where the
sponsoring organization for a sponsored TLD feels that its target
community would be well served by new names that are IDN translations or
transliterations of the existing sponsored gTLD, these may be permitted
with the explicit consent of that sponsoring organization. Any such new
domains must, at the least, be obliged to follow the policies of the
original sponsored gTLD. (It may be noted that these policies will
likely require modification to accommodate their implementation in
multiple languages).

* LDH - Letters-Digits-Hyphen is the more correct description of what is
commonly called ASCII when related to domain names. LDH comprises 26
Latin letters without diacritical marks, 10 Arabic digits and the
hyphen. LDH is a subset of ASCII.

Strategies to meet the objective criteria

Registries could operate multiple gTLDs. A single registry need not
be linked uniquely with one name. However, in order to meet the
objective on competition, this flexibility will need to be limited to
the extent that it might lead to market dominance in the supply of
registry services. A judgement on dominance needs to be well balanced:
ICANN should not needlessly set barriers to entry for new applicants by
restricting their choice of business partners, nor needlessly prevent
new applicants benefiting from any economies of scale resulting from
multiple TLD registries.

Multiple sponsorships. To the extent that a TLD is sponsored,
sponsors would typically sponsor a single gTLD, though it should be
possible for a sponsor to sponsor additional names where the nature of
the sponsored space is complimentary.

Differentiation. There is wide but not universal support for what
was termed variously segmentation or differentiation. Most participants
agreed that each new gTLD must be clearly differentiated from any other
gTLD already assigned. It was generally agreed that given the objective
of a demand-driven bottom-up space, ICANN need not be in a position to
have to judge differentiation beyond the obvious. If a new
registry/sponsor proposed a name which met the objectives above and
promised differentiation, that should be sufficient to award the name.
As stated by a representative on the non-commercial constituency,
whether the applicant subsequently succeeded in achieving true
differentiation would be a function of the success of its business
model.

To sponsor or not to sponsor?

Expansion of the name space of only sponsored gTLDs was
universally preferred by the constituencies who represent commercial
users (the Business Constituency, the Intellectual Property
Constituency, and the Internet Service Providers). The Non-commercial
and the At-large representatives favoured both sponsored and unsponsored
names; and the two supplier constituencies (Registrars and gTLD
registries) simply favoured expansion.

Additional considerations

Technical and financial qualification

Registries should be required to demonstrate technical and financial
competence during the contract-negotiation stage with ICANN. This
demonstration should not be a significant barrier to entry. Financial
competence will need to be demonstrated in a uniform and objective way
though this may be context relevant to the specific business model and
proposed size of the gTLD. A performance bond may be an elegant
solution for ICANN: it in effect devolves the judgement on financial
competence to a third party while providing the required reassurance.

The application fee for future applications for names should
discourage spurious applicants, but should also not penalize losers
beyond the actual administrative costs borne by the ICANN secretariat.

Registry/sponsor failure

The investment made by registrants in their name should be protected
from the consequences of registry failure. It may be sufficient that
ICANN maintains the ability to itself swiftly transfer the relevant TLD
zone file* from the failed registry to another registry.

There is a need for rules to determine the conditions under which
such a transfer would take place.

Annex 1
Background on establishment of the committee

Part III Recommendation: As ICANN proceeds with its new TLD evaluation
process - and, if the Board concurs, with an additional round of new
sponsored TLDs - this basic question of taxonomic rationalization should be
addressed within the ICANN process. Accordingly, it is my recommendation to
the ICANN Board that the DNSO and its Names Council be requested to develop
and submit its advice and guidance on the issue.

Whereas, the Board accepted the report of the ICANN New TLD Evaluation
Process Planning Task Force (NTEPPTF) at its meeting on 23 August 2002;

Whereas, at that meeting the Board instructed the President to develop a
plan for action for approval by the Board;

Whereas, the President presented An Action Plan Regarding New TLDs for
discussion at the Public Forum in Shanghai on 30 October 2002, and posted
that Action Plan for public comment on 8 November 2002;

Whereas, comments have been received, posted, and evaluated regarding that
Action Plan;

Whereas, the Action Plan was again discussed at the Public Forum in
Amsterdam on 14 December 2002; and

Whereas, the Action Plan recommends that key recommendations of the NTEPPTF
report be implemented; that certain questions regarding the future evolution
of the generic top-level namespace be referred for advice to the GNSO
described in Article X of the New Bylaws approved in Shanghai on 31 October
2002 and as further refined at this meeting; and that steps be taken towards
approval of a limited number of new sponsored gTLDs;

Resolved [02.150] that the Board authorizes the President to take
all steps necessary to implement those aspects of the NTEPPTF
recommendations as specified in the Action Plan;

Resolved [02.151] that the Board requests the GNSO to provide a
recommendation by such time as shall be mutually agreed by the President and
the Chair of the GNSO Names Council on whether to structure the evolution of
the generic top level namespace and, if so, how to do so;

Resolved [02.152] that the Board directs the President to develop
a draft Request for Proposals for the Board's consideration in as timely a
manner as is consistent with ICANN staffing and workload for the purpose of
soliciting proposals for a limited number of new sponsored gTLDs.

February 2003, ICANN's general counsel has clarified that the Board asked
for the GNSO Council to formulate and communicate its views on two separate
questions. The questions are:

whether to structure the evolution of the generic top level
namespace and,

if there should be structuring, how to do so.

Annex 2
Constituency positions (in alphabetical order)

Commercial and Business Users

Intellectual Property Interests

Internet Service and Connectivity Providers

Non-Commercial Users

Registrars

gTLD Registries

At-large Advisory Committee

Business Constituency Position Paper

A Differentiated Expansion of the Names Space - December 2002

Background

In 2002, just under 30 million generic top-level domain names (gTLDs)
and approximately 12 million country-code top-level domain names
(ccTLDs) were registered. In late 2000, ICANN authorized as a proof of
concept four new unsponsored names (dot biz, info, name, pro) and three
sponsored names (museum, aero, co-op). The ICANN board has authorized an
evaluation: this needs to move ahead with urgency. In parallel at the
October 2002 Shanghai meeting ICANN launched a debate on a process for
how to introduce further gTLDs. The need for such a process was
mentioned in the September 2002 memorandum between the US Department of
Commerce and ICANN. The Business Constituency (BC) endorses this process
and recommends the ICANN Board refer the process to the DNSO/GNSO Names
Council.

A new approach to the registry - name relationship

The BC proposes a separation of the registry and the name. In contrast
to the earlier ICANN process, where a single registry lived or died by
one proposed name, there should be a set of qualified registries free to
operate the back-end of multiple gTLDs, each of which has a different
sponsor. Under this system, a registry that failed could be replaced by
another registry without removing the name from the domain name system,
and so protecting the investment of registrants.

A differentiated expansion of the name space

Given that there is pressure on ICANN to introduce additional names, the
BC supports the development of a logical expansion, which will result in
a name space with added value, rather than the cloning of the existing
space. Such a value-added space will create differentiation and reduce
the need for entities to defensively register.

Users - regardless whether they are businesses, non-profit organizations
or individuals - want certainty. Spending time searching is not cost
effective. The user community needs a certain process for identifying
prospective names and a certain process for selecting
sponsors/registries to operate those names:

Step 1 ICANN agrees to a set of principles for all future
domain names.

Step 2 ICANN invites qualified sponsors and registries[2] to
apply for names conforming to those principles.

The principles - all new domain names must meet the following
principles:

1

Differentiation

a gTLD must be clearly differentiated from other gTLDs

2

Certainty

a gTLD must give the user confidence that it stands for what it
purports to stand for

3

Honesty

a gTLD must avoid increasing opportunities for bad faith entities
who wish to defraud users

4

Competition

a gTLD must create value-added competition

5

Diversity

a gTLD must serve commercial or non-commercial users

6

Meaning

a gTLD must have meaning to its relevant population of users

Creating a logical names space by adherence to the principles

The principles in effect determine a taxonomised or directory-style
domain name structure. This taxonomised structure opens up a range of
places where individuals, companies and organisations will find a place
they want to be, and where users can easily find them. The structure
does not imply a rapid expansion. The choice of one name will preclude
future non-differentiated choices.

Avoiding the need for defensive registrations

The BC sees no value in new unsponsored/unrestricted names and would
need to be convinced otherwise by the results of the evaluation process.
The BC's current position is that all new names should be
sponsored/restricted within the ICANN categorization[3]. (In time some
of these new names will be internationalized domain names). The
sponsor/registry will be responsible for ensuring the integrity of the
domain name to its differentiated, restricted charter. The ability to
buy a name in a particular TLD will be restricted to those who can
demonstrate they are bona fide members of the target group. Every
registrant will be authenticated by the sponsor/registry to ensure that
they are registering names that are germane to their businesses and not
infringing on another's intellectual property.

Sponsored/restricted gTLDs build consumer confidence because they avoid
confusion and limit fraud. In addition, the policing by the
sponsor/registry simultaneously solves three intellectual property
issues. Cyber-pirates will not be able to obtain the names of others.
There will therefore typically be no need for costly defensive
registration. New WhoIs databases will be verified and therefore
accurate.

Threshold qualifications for applicant registries

Separate to this new naming structure, there needs to be a new process
of qualifying registry applicants. The stability of the domain name
system requires registries to meet user expectations for sound global
business practices. The BC, building upon previous ICANN criteria,
proposes[4] certain elements which must be assured by an applicant
registry. Depending on the model these may apply to the sponsor or the
registry.

Next steps

ICANN needs to debate and agree to the six principles and the above
qualifying process without delay. This longer term view will however
only be possible once the evaluation of the last "proof-of-concept"
expansion is complete, and this evaluation is taken into account.

In the meantime, the BC can support the proposal of the ICANN CEO for up
to another three sponsored/restricted names as a first deployment of the
new long-term structure favoured by the BC. The BC proposes that its six
principles can provide guidance in this interim expansion.

BC Annex 1 - ICANN gTLD categories

. Policy
Scope

Sponsored

Unsponsored

Restricted

.museum
.aero
.coop

.name
.biz
.pro

Unrestricted

not possible

.com
.org (as at 6.2002)
.net
.info

ICANN definition: A Sponsor is an organization to which ICANN delegates
some defined ongoing policy-formulation authority regarding the manner
in which a particular sponsored TLD is operated. The sponsored TLD has a
Charter, which defines the purpose for which the sponsored TLD has been
created and will be operated. The Sponsor is responsible for developing
policies on the delegated topics so that the TLD is operated for the
benefit of a defined group of stakeholders, known as the Sponsored TLD
Community, that are most directly interested in the operation of the
TLD. The Sponsor also is responsible for selecting the registry operator
and to varying degrees for establishing the roles played by registrars
and their relationship with the registry operator.

Applications must conform to the six principles. Applicants must
demonstrate an understanding of the needs of the proposed new community
of name holders, through meeting a set of criteria which supports the
six principles.

Building Trust with a UDRP and an accurate WhoIs database

The business plan should promote the interests of intellectual property
right holders and avoid the need for defensive registrations. A dispute
resolution process that conforms to the ICANN UDRP must be included as
well as an accurate and accessible WhoIs conforming to the forthcoming
recommendations of the Names Council. The application must support trust
by users that names in the new registry space will be what they purport
to be. The applicant must agree to adopt all future consensus policies
such as those relating to transfers, deletes and renewals.

Operations and Technical

Technical and operational management of the registry must be fail-safe
on a 7/24 basis worldwide. The technical team, whether employed directly
by the manager, or contracted, should be able to demonstrate their
ability to install and operate a TLD registry in accordance with
existing standards. Plans for database information capture, validation
and maintenance must meet expectations for ready access by users and
others with authorized access privileges. Data escrow and related
disaster recovery procedures must ensure continuity of operations under
emergency circumstances.

Financing

The financial plan should evidence understanding of the cost of
providing registry services for the intended community of name holders.
Adequate initial capitalization and arrangements for ongoing working
capital, reserves and the cost of technical back-up must be
demonstrated.

Intellectual Property Interests

Although the IPC's preference was for the NTEPPTF designed study of the
seven gTLDs approved in 2000 to be completed prior to the introduction
of any additional domain name suffixes, we find generally that properly
administered sponsored gTLDs present, as Stuart Lynn states in his paper
titled "A Plan for Action Regarding New gTLDs," "fewer worries about
trademark infringement and cybersquatting." We therefore do not object
to the introduction of a limited number of new sponsored gTLDs, provided
that the abbreviated study of existing sponsored gTLDs suggested by Mr.
Lynn confirms this finding. (The abbreviated study will, according to
Mr. Lynn, ask "Is there any evidence that sponsored TLDs are havens for
cybersquatting or other registration abuses likely to cause concerns
among significant portions of the Internet community?")

Consistent with previous statements made by the IPC , we strongly
suggest that the ICANN Board of Directors insist that applications for
the new sponsored gTLDs have clear and specific rules regarding
registration in the namespace. Specifically, any new sponsored gTLD
should have, at a minimum, clear rules about who is permitted to
register second-level domain names in that space, and about what
activities are or are not appropriate or acceptable on the corresponding
sites, and for what purposes. Furthermore, these applications must also
include a system to make sure that prospective domain name applicants
qualify for registration under the sponsor's charter prior to obtaining
a domain name registration. Moreover, a mechanism needs to be in place
to ensure efficient resolution of violations of the sponsored gTLD's
charter or restricted nature, and must provide that any third party have
standing to challenge a domain name under these mechanisms. In this
regard, a procedure must be established whereby a registrant found to
have provided false information as to its entitlement to register in the
sponsored gTLD, or to have registered or used a domain name registration
in violation of the established purpose of the sponsored gTLD, will have
the offending domain name removed from the namespace.

The IPC supports the BC suggestion that there be "A differentiated
expansion of the name space," and has advocated such a position over the
years. The IPC finds merit with the BC position that "all new domain
names must meet the following principles": differentiation, certainty,
honesty, competition, diversity, and meaning. Finally, the IPC does not
as yet have a position on the BC proposal for the separation of the
registry and the name, but it is one that is worthy of further
consideration.

Position paper on the introduction of new gTLDs

Background

Following the introduction of seven new gTLDs in 2000, four new
unsponsored names (dot biz, info, name, pro) and three sponsored names
(museum, aero, co-op), debate is now taking place on the introduction of
additional new names. The following points set out the views of the
ISPCP on this matter and form the basis of the Constituency input to the
discussions within the gNSO.

A Fundamental Premise

Adding new gTLDs to the DNS is both a policy and technical activity. No
action should be taken that might, in any way, threaten the stability of
the DNS.

Views of the Constituency

The following points reflect the agreed Constituency approach towards
the introduction of new gTLDs

Since 2000, the ISPCP has carefully monitored the process of
introducing the seven gTLDs. It notes that through the course of
introduction and execution, as well as the experience gained from that
exercise, lessons have been learned which should assist the ICANN
community in avoiding a repeat of some of the problems which have arose
throughout that period.

In particular, the lessons learned from the initial
introduction of new gTLDs should result in a consistent and common set
of safeguards for consumers and those that depend on the operation of
registries.

The measured approach to test 'proof of concept' has proved
worthwhile, but it is the view of the Constituency that no magic formula
has appeared which could ensure that a totally open and uncontrolled
approach would not jeopardise the stability of the Internet, or cause
significant problems to key Internet stakeholders.

The ISPCP supports the continuation of a deliberate approach
that will facilitate additional learning to occur and experience to be
gathered. It is proposed that a phased approach should be adopted, with
new names being introduced during set 'windows of opportunity',
initially occurring not more than twice per calendar year.

The ISPCP would support the concept of a task force set up
to make periodic recommendations on the process of introducing new
gTLDs. This task force should be part of the gNSO and not be dominated
by staff.

Such an approach would enable careful evaluation to take
place, with the potential to increase the opportunity to introduce more
gTLDs quickly, as lessons are learnt and the practice becomes more
robust. The ISPCP believes that eventually the approach should
gradually evolve from a "measured approach" to one that is continuous
and self managing.

The ISPCP does not believe there need be a specific
prearranged limit on the number of names assigned during each 'window',
but each new gTLD must fit within an agreed framework where:

each new gTLD must be clearly differentiated from any other
gTLD already assigned;

where an application appears to have some alignment with an
existing gTLD, its particular use and focus, (how it relates to existing
gTLDs) must be carefully scrutinised and only allowed where additional
proven benefit and value add can be substantiated. In this case the
barrier to assignment should be considered higher than what it would be
for a new gTLD where no conflict is deemed to exist.

An easily understood relationship must exist between a new
gTLD and its stated purpose, thereby minimising the chance of user
confusion.

The ISPCP does not support an approach that would see the
rapid increase of gTLDs in an uncontrolled manner.

Care must be taken to ensure that users can substantially
invest in the use of a chosen domain without undue fear of failure. This
can only be achieved if new domains are introduced in a controlled
manner which reduces the likelihood of failure and loss.

Sponsored gTLDs should be looked on more favourably. They
have the potential to overcome many problems by imposing qualifying
criteria which have to be met in order to register. However careful
judgement must be applied when setting this criteria to ensure undue
barriers are not set in place which inhibit their use. At the same
time, the ISPCP urges a careful and balanced approach in choosing the
subject of sponsored gTLDs, so that ICANN does not become embroiled in
policing sensitive gTLDs such as those involving minor children.

The constituency thinks that existing sponsored registries
should be encouraged to (and have the right to) provide
Internationalized Domain Name versions of their TLD strings in non-ASCII
characters with the same semantic meaning as their ASCII TLD string.
They should be given first right of refusal for those IDN strings and
not treated as a new proposer of a gTLD.

In the case where new gTLDs are to be proposed that support
Internationalized top level domain names, the constituency believes that
consistent rules should be applied. In our opinion the rules must
include, an open call for proposals, defined criteria for selection,
independent review by technical and financial experts, and full
transparency of all proposals. The constituency thinks this set of
principles should apply equally to non-ASCII TLD proposals, with
additional criteria for selection, perhaps focusing on the proposed
registry's plans to meet the needs of (and make policy for) the language
communities to be served by a new TLD string in a given script.

Non-Commercial Users

NCUC Statement on New TLDs.

V 1.2, 18 February 2003

Approved by Adcom 24 Feb 2003

In response to CEO Stuart Lynn's call for policy guidance, a GNSO Names
Council Committee has adopted a document defining a policy approach to
new TLDs. That policy is based on a Business Constituency position paper
defining a restrictive approach to name space management.

The proposal is inimical to the interests of most domain name users. If
implemented it would have the following negative effects:

It would dramatically raise the cost of domain name
registration in new TLDs

It would limits users' choice of an online identity and
thwart any attempt to introduce popular new names that responded to real
user demand

It would bring a halt to competition in the registry market

It would defeat any attempt to innovate by tailoring registry
architecture and technology to specific markets

The claimed benefits of this approach do not exist:

It would not help preserve user service when registries fail

It would not have any beneficial effect on users' ability to
find things on the Internet

The NCUC supports a demand-driven approach to TLD additions. ICANN
should allow new names to be proposed by interested communities,
entrepreneurial registry operators, or a combination of both. We believe
that ICANN should define a process that permits addition of a maximum of
30 new TLDs each year. Five of these 30 should be reserved for
noncommercial user groups. ICANN's assessment of these applications
should be based on adherence to a minimal set of ICANN-defined technical
specifications and conformity to established ICANN policies, such as
UDRP. Approving a TLD should be - and could be - as simple as
accrediting a registrar. Whether the business models proposed were
"sponsored" or "unsponsored," "restricted" or not, would be up to the
applicants. Contention among applicants for the same name would be
settled by auction, with the proceeds going to ICANN. We understand that
such a procedure raises many issues of detail that are not elaborated
here. But the basic policy issue put before the GNSO is whether TLD
additions should be demand-driven or "structured." We favor the open,
demand-driven approach.

The NCUC cannot support the proposed GNSO TLD Committee Policy.
Contrary to the above stated principle favoring an open and competitive
structure, the Committee proposes that no open TLD should be allowed to
exist ever again. ICANN would only expand the name space by defining a
fixed, mutually exclusive set of categories that users would be stuffed
into. All new TLDs would be sponsored and restricted, and registries
will be forced to authenticate registrants "to ensure that they are
registering names that are germane to their businesses and not
infringing on another's intellectual property."[5] (We note with
disappointment the proposal's apparent inability to understand that not
all domain names are owned by "businesses.")

The Committee also proposes a radical change in the nature of the
domain name registration industry. It proposes that registries should
have no control over the TLD names that they operate. Instead, ICANN
will make itself a central planning authority for the name space,
defining all TLD names and assigning operation of the names to
"qualified" registry operators. We note that the proposal says nothing
about the critical issue of how names are assigned to registries, an
issue of tremendous political and economic importance.[6]

We wish to make the following observations:

The concept of a "structured" or "taxonomised" name space, faces
a great deal of opposition among ICANN participants, and has no apparent
support outside the BC/trademark constituencies. At the Amsterdam public
forum, opponents outnumbered supporters by a 10 to 1 ratio. We also note
that a member of the BC and a member of the Intellectual Property
constituency were among the public critics of the proposal in Amsterdam.

The proposal favors the interests of incumbent registries who do
not want to face competition from new entrants, and a small class of
major corporate trademark holders, who comprise 5 percent of the
relevant population of users at most. Worse, it does so at the expense
of noncommercial and other users who benefit from registry-based
competition.[7] We believe that economic protectionism is an
illegitimate policy concern and should play no role in ICANN's approach
to new TLDs. We believe that IPR holders do have legitimate concerns
about defensive registrations, but that those concerns are best
addressed through UDRP and other ex post facto policy measures, not by
throttling the market for domain names. Only one quarter of one percent
of all registrations are ever challenged. Artificially-imposed scarcity
of TLDs increases the gains from illicit forms of name speculation. TLD
expansion would diminish those incentives and reduce cybersquatting in
the long term.

Above, we noted 6 reasons why the GNSO Committee proposal is not in the
interests of domain name users. We elaborate on these problems below.

Higher costs

Forcing all new TLDs to carefully authenticate a correspondence between
the identity of a registrant and the TLD name would make all domain name
registration a slow and manual process. Costs would quadruple over what
users pay now. We do not oppose and may often favor the creation of new
TLDs that are sponsored and restricted. But many users have no interest
in or need for authenticated and restricted domains. That is why there
are thousands of times more registrations in open domains than in
restricted domains.

Limited choice

The proposal offers a top-down approach to naming that will not be
responsive to actual user demand and user needs. It is impossible for
ICANN today, or at any time in the future, to predict what names or
categories users will find useful and desirable unless it uses a
demand-driven approach to TLD addition. Tastes, conditions, and names of
interest change over time. Names like and , utterly
meaningless a few years ago, have entered our vocabulary and become
important. The root zone must have a procedure to add new names in
response to demand. We strongly support the market-oriented,
customer-driven approach in which applicants for TLD names/ registries
approach ICANN with their ideas, and ICANN has in place an objective,
efficient procedure for authorizing them and resolving contention and
conflict.

As a constituency whose membership is globally diverse, the NCUC also
believes that no centrally imposed naming structure can satisfy the
global needs of the Internet; there is too much linguistic, economic,
and political diversity. A uniform categorization scheme will result in
semantic conflicts; a category name in English might mean something
completely different in German.

ICANN's basic mission is simply to coordinate unique parameters to
permit stable and consistent operation of the root zone. It should not
attempt to tell the public what names they "ought" to adopt or what
categories they "ought" to fit into.

An end to competition in the registry market?

The proposal to separate the registry operator from the name would have
a number of negative effects on the domain name market. First, it would
discourage if not destroy new entry and competition in the registry
market. Since the proposal requires all new names to be restricted, the
market size of any new TLDs will be miniscule. Hence, no new registries
will find it feasible to enter the market. All new names will be
assigned to the few dominant registries that already exist.

Competitive entry would also be discouraged by the inability of a
registry operator to have any control over the name they supplied. It is
noteworthy that ALL new entry into the domain name registry market since
ICANN's inception has come from specific registry operators interested
in supporting specific names that they believe would attract specific
user communities.

The separation concept fails to consider how markets operate and how
innovation and competition occur in a market economy. Consider the
following questions:

Who is going to finance and build a domain name registry when
they have no idea what name, if any, they are going to operate?

How can prospective registries construct a business plan and
raise capital if they do not know whether they will be awarded something
on the scale of (tens of millions of registrations) or something
on the scale of (with a few hundred registrations)?

How can prospective registries develop effective marketing and
branding concepts if they have no interest in the name per se and no
prior ties to the communities served by the TLD?

Why should a community of Internet users that invests time and
money in getting a name established have no control over who provides
them with registry service?

Integrating name, registry design, and service is necessary

Separating the name from the registry would harm technical innovation.
How can prospective registries design, develop and execute innovative
services closely tailored to the unique needs of a named group if they
are a hollow, generic registry that is passively handed character
strings to service? Registries are databases. As anyone who has designed
and built a database knows, the structure and operation of a database
are very sensitive to the type of data one is dealing with and the
unique needs of the users of the data.

Responding to Registry Failure

The assertion that separating the name and the registry makes it easier
or more efficient to protect the investment of registrants when a
registry goes out of business is simply false. The only protection that
users can possibly have against a failing registry is that its DNS
records are stored somewhere and can be transferred to a new operator
willing and able to serve them. Under a normal, market-oriented regime
failing registries would sell their customer base and associated records
to a surviving registry. In a competitive market many operators will be
happy to purchase additional customer base. In the proposed "command
economy" approach, what will happen? At best, ICANN will ask available
operators which registry wants to take over the names, and if multiple
operators are interested it will hold an auction for that right. This is
not much different than the effect of a market, except for the
interposition of an unnecessary mediator. At worst, ICANN will simply
order a registry to take over and serve the names regardless of whether
it wants to or it feels it has the capacity to do so - a method unlikely
to produce good service. At any rate either response to failure does NOT
require strict separation of the name from the registry.

Finding things on the Internet

The proposal reflects a popular, but increasingly erroneous belief that
by stuffing millions of domain names into defined categories, ICANN will
make it easier for Internet users to "find things on the Internet." To
the extent this premise was ever valid, it has become increasingly
suspect as the number of names populating the space has grown and the
general Internet-using population has grown more sophisticated. Internet
users do not search the Internet by scanning lists of domain names. Even
if a clean, intuitive "taxonomy" of TLDs could be defined, each TLD
would have at minimum thousands of entries in it, and the largest ones
(like .com, .net, .org, .de and co.uk) would have tens of millions of
entries. No one in their right mind is going to seek content by scanning
a list of registered domain names and trying to guess what services or
content is stored at them. Users have a variety of far more
sophisticated tools at their disposal, such as search engines, portals,
and referrals.

More importantly, to the extent genuine "initial interest confusion" may
exist, injured parties have recourse to both the UDRP and the courts.

Domain names are not about finding things we are looking for. Domain
names are just memorable identifiers, not a directory or a search token.
They are to assist us in easy communication. That is why they have to be
memorable, not systematic. Most people's memory works through
association, not categorizing. For this reason, to the extent ICANN has
legitimate concerns protecting intellectual property or businesses, it
should rely on post hoc remedies such as UDRP.

Conclusion

The proposed model of TLD development that seems to have captured the
GNSO Committee is unduly restrictive and unimaginative. It assumes that
all domain name services and applications are generic and must fit into
existing business and policy models. It leaves little room for
innovation. We need to question the model of ICANN-accredited-registrars
for all future TLDs. There may be a 'market' for free domains. (e.g.,
Why can't someone (say the Red Cross) start the TLD .help and give away
domain names there for free?) In any case free domains are made
impossible by the current registry-registrar structure. TLD policy
should also make it possible for alternative WHOIS policies to exist.

Registrars

The ICANN gTLD Registrar Constituency continues to support the expansion
of the namespace in a controlled and responsible manner. The
Constituency supports the criteria for expansion set forth in Stuart
Lynn's paper, released on March 25, 2003
(http://www.icann.org/riodejaneiro/stld-rfp-topic.htm), as a practical
step forward in a discussion that has been historically beleaguered by
theoretical discussion of academic improbabilities. The Registrar
Constituency believes that the Board of Directors of ICANN should adopt
these final criteria, without delay and further that;

ICANN should, in parallel, move forward with the creation of an
Accredited Registry Services Provider program which, having been based
on objective criteria, facilitates competition, innovation and continued
growth within this nascent sector;

ICANN's Board of Directors move to implement a scalable long-term
plan that institutionalizes the processes by which new generic top-level
domain names are chartered and delegated and that such processes should
governed by the following broad principles;

that the ongoing expansion continue take place in a controlled and
responsible manner,

that any criteria used to evaluate charter and delegation proposals be
objective and equitably applied to all proposals

that delegants and operators be encouraged to leverage existing
registry protocols and not create new ones

that delegants be encouraged to explore and implement new business
models

that businesses be allowed to fail, but that strong redelegation
practices be immediately implemented to ensure TLD continuity

that registrar competition continue to be encouraged and remain a
cornerstone of this growing market and that all accredited registrars
continue to have equal and equitable access to registry operations and
services

gTLD Registries

gTLD Registries Statement on New TLDs

At its meeting in Amsterdam on 15 December 2002, the ICANN Board passed the
following resolution:

"Resolved [02.151] that the Board requests the GNSO to provide a
recommendation by such time as shall be mutually agreed by the President and
the Chair of the GNSO Names Council on whether to structure the evolution of
the generic top level namespace and, if so, how to do so."

The Registry Constituency believes that the Board should not structure
the evolution of the generic top level name space in a manner that limits
the development of a market-based evolution of additional generic top level
domains. The Constituency urges the Board to foster this continuing
evolution without imposing on it a structure (e.g. sponsored or unsponsored,
chartered or unchartered) that is predetermined by the Board.

The Board should solicit technical assistance from the IETF on the
question of how many new TLDs can reasonably be added each year, consistent
with (a) the requirements of RFC 2628 "IAB Technical Comment on the Unique
DNS Root" and (b) the technical stability of the Internet.

The Board should promptly establish minimum measurable technical and
financial qualifications that all new registry operators should meet.

The Board should promptly post for community review a proposed agreement
with new registry operators that contains only those provisions reasonably
necessary to assure interoperability and stability. It is reasonable to
require that new registry operators:

choose new TLD names that are not identical or confusingly similar to
other tope-level domain names in the root zone file, and that the operators
are subject to a procedure comparable to the UDRP to resolve any disputes
that may arise;

adopt the UDRP for the resolution of abusive domain name disputes within
the domain;

operate in accordance with established technical standards, including
provision for a "disaster recovery" plan in the event the registry operator
goes out of business; and

comply with consensus policies adopted by ICANN consistent with the goal
of market-based evolution of the name space.

The Board should offer to existing registries similar applicable terms and
conditions that are offered to the new registries.

The Board should open a process for prospective registry operators that
meet the minimum technical and financial qualifications. Each applicant
should be free to decide how and whether to restrict or otherwise define its
registrants and to propose how to market its name.

The Board should establish, after input from the constituencies, a
procedure to select from among multiple applicants, either for the same
names or for different names, if, because of technical considerations, there
are more applicants for names than are then feasible to be added to the name
space.

At-large Advisory Committee

Introduction:

At-large Internet users are both domain name registrants and users of
the domain name system. As users, they are well served by TLDs that
are not confusingly similar, enabling them to differentiate the names
they encounter and minimize typographic or semantic mistakes; they
are also served by a namespace that is inclusive and provides access
to a wide variety of speakers and information sources. As
registrants, the "at large" are perhaps the most likely to be
underserved by community-defined, chartered gTLDs. Not all
individuals are necessarily a part of any of these communities, yet
they will want places to publicize their small businesses, engage in
political debate, discuss their interests, and host weblogs, to name
a few. Categorization and eligibility requirements will often act as
barriers to entry to such registrants. As a whole, at-large
registrants are most likely to be served by a range of TLD options
available to all potential registrants, including a variety of true
generics for those that do not fit in neat categories.

These interests are compatible; confusion can be minimized without
narrowly structuring registrations. They are also compatible with
ICANN's limited mandate. ICANN should not be setting itself up as
judge of the utility or fitness of business plans, but only as a
technical judge of what is likely to create confusion or interfere
with the functioning of the domain name system.

Criteria to Be Used in the Selection of New Sponsored Top-Level
Domains

Both the paper and report on existing sponsored TLDs err in focusing
primarily on exclusion: Do the sponsored gTLDs represent a limited
community and adhere to their charters by permitting registrants only
from within that community? The question more important to the
public's communicative goals, however, is the flip side: Are there
people or organizations who are left without logical places to
register domain names, or who are denied registration in a sponsored
TLD whose charter they fit? It is easy to make the error rate
arbitrarily low by asking questions that examine only one kind of
error -- gTLDs could block all cybersquatters simply by refusing any
registrations, but that would hardly serve the point of adding new
gTLDs.

Instead, the Board should look, in both the sponsored additions and
in the general question of "structure," to ensuring that all who want
to establish online presences can obtain domain names.

Financial qualifications and entry fees can be barriers to entry of
new and smaller gTLD participants, as well as to non-profits. While
fees may be necessary to discourage spurious applications and to
recover assessment costs, minimal criteria can help to minimize costs
and fees. ICANN should examine the possible introduction of a second,
lower fee scale for non-profit applicants.

At this stage, there appears to be general consensus on the GNSO
gTLDs Committee to advise against "structure" in the first instance.
As the Draft states, "It was agreed that a future expansion of the
gTLD name space should take place in such a way that was
demand-driven and bottom-up and in a way that increased competition
while avoiding net user confusion and deception. To the extent that
this report has a set of recommendations, it would seem there is
support for the idea that the structure of the future gTLD namespace
should be structured determined in a number of ways primarily by the
choices of suppliers and end users in the market." The ALAC supports
this recommendation.

Market participants, including both businesses and non-commercial
organizations, users and suppliers, are better positioned to indicate
where new TLDs are needed through demand and willingness to supply.

The ALAC supports the proposition that proposal of a name by a
competent registry/delegant/sponsor provides as much
"differentiation" as is necessary. (Draft para. 14) Every TLD has a
natural monopoly in the SLDs registered under it, but ICANN policy
should not extend that monopoly any further. Put slightly
differently, a name should be acceptable within any gTLD structure if
users want it and it does no harm to the domain name system.

In order for market determination to be successful, ICANN must enable
a genuine competitive market to develop. At present, there appears to
be some tension between market competition and desire to protect
registrants from the consequences of registry failure (Draft paras.
10-12). The intermediate road ICANN has taken, a heavily regulated
market (rather than free market or openly acknowledged planning),
tends to produce false assumptions and conclusions about what "the
market" will support (and thus to justify further planning). The ALAC
supports the Draft's recommendations that zone file escrow and
transfer arrangements be investigated as ways to mitigate registry
failure. The ALAC also recommends further examination of separation
of the policy and technical roles of new-TLD-registries, as suggested
in Ross Rader's proposal for distinct Delegants (policy) and
Operators (technical), see
http://r.tucows.com/archives/2003/03/13/new_gtlds_part_ii.html

Consistent with openness to a variety of names and business models,
ALAC supports expansion that allows both sponsored and unsponsored
names. (Draft para 15) Along with Milton Mueller and Lee McKnight,
"We do not oppose and may often favor the creation of new TLDs that
are sponsored and restricted. But many users have no interest in or
need for authenticated and restricted domains. That is why there are
thousands of times more registrations in open domains than in
restricted domains." Mueller & Mc Knight, "The post-.COM Internet,"
http://dcc.syr.edu/miscarticles/NewTLDs-MM-LM.pdf

IDNs: Any evaluation of IDNgTLDs (internationalized domain name
generic TLDs) should ensure participation in the linguistic review
for confusion by the language community that would primarily use and
be affected by the IDN policy. The ALAC plans to discuss IDNs in
more detail in a separate document.

[6] If names are assigned to registries based on ICANN's ad hoc
discretion (which is how ICANN's Board usually makes decisions), then
the assignment process is rife with opportunities for political
haggling, discrimination, collusion and insider dealing, as registries
and registrars play a major role in selecting the Board. If names are
assigned on the basis of competitive bidding, then the bids will reflect
the value expected of specific names, and we are very close to where we
would be in a regime that allowed registries to propose their own names.

[7] It is useful to draw a comparison between what is now referred to in
telecommunications policies as "intermodal competition" (such as between
competing platforms) and "intramodel competition" (where rivals share a
platform). The proposal favors intramodal competition (between
registrars using the shared SRS platform) but eliminates intermodal
competition (among registries). From a consumer perspective, both are
valuable and should be supported.